Capital outflow from Russia to hit 65 bln USD

The capital outflow from Russia could hit 65 billion U.S. dollars by the end of 2012, the Russian Central Bank said Wednesday. Due to unfavorable investment conditions, the Central Bank has adjusted its previous forecast of 40 billion dollars to 65 billion dollars, First Deputy Head of the Central Bank Alexei Ulyukayev told reporters. However, Ulyukayev stressed that the outflow tide could still be reversed in the third quarter and the fourth quarter due to the IPO of Sberbank, the largest commercial bank in Russia. The Central Bank offered in this week 7.58 percent of the Sberbank's shares with an aim to raise 5.2 billion dollars.8 "I don't rule out that this (reverse) could happen in the end of third and fourth quarters," Ulyukayev said. In the first half of 2012, capital outflow amounted to 43.4 billion dollars in Russia. Ulyukayev also noted that the inflation rate in 2012 could "possibly" exceed the bank's previous forecast of 5 to 6 percent, as this level had already been reached on Sept. 17. The Ministry for Economic Development has forecasted the country's inflation rate would reach 7 percent in 2012.